Appreciated Cars Don’t Depreciate Best Resale Value Vehicles

While most car buyers understand their vehicle will depreciate – many have heard the old adage, “a vehicle loses value the moment you drive it off the lot!” – the average person may not be fully aware to what extent and how much this amount can vary from one model to the next. Understanding a car’s resale value can make the difference of hundreds, if not thousands, of dollars in the long run. To help new-car buyers shop smart, Kelley Blue Book, a Cox Automotive company, today announces the 2023 model-year brand, category, and top 10 winners of the 21^st annual Best Resale Value Awards, recognizing vehicles for their projected retained value through the initial five-year ownership period.

Prices of many consumer items remain inflated nearly three years after the pandemic began. Supply chain issues have improved within some industries and yet still remain a challenge in others, including the automotive industry. These challenges ultimately impact supply and demand, with the increased costs trickling down to consumers who are paying record-high prices for new cars. At the end of 2022, the average transaction price (ATP) of a new vehicle reached a record high of $49,507, and ATPs have remained above sticker price (or MSRP, the manufacturer’s suggested retail price) for more than a year, according to data from Kelley Blue Book. Given the fact that new-car buyers are paying more up front now than ever before, experts recommend they seriously take into account a vehicle’s resale value as they consider their purchase decisions.

“Toyota wins Best Resale Value: Brand for 2023, while its sibling Lexus wins Best Resale Value: Luxury Brand, both enjoying top honors for the second consecutive year,” said Janice Yoell, senior manager of valuations for Kelley Blue Book. “In addition, Kelley Blue Book made some changes to the vehicle categories for the 2023 Best Resale Value Awards, adding additional categories to reflect the growing electric vehicle market. In recent years the awards featured just one overall Electric Vehicle category, but now Kelley Blue Book’s Best Resale Value Awards include categories for Electric Car, Luxury Electric Car, Electric SUV, Luxury Electric SUV and Electric Truck. As the automotive landscape shifts and manufacturers continue to introduce more and more electric models, it was fitting to expand the award categories accordingly.”

This year marks the seventh Best Resale Value: Brand win for Toyota, which previously won the same honors in 2014, 2017, 2018, 2019, 2021 and 2022. For 2023, Lexus celebrates its second consecutive win and fourth time overall winning the award for Best Resale Value: Luxury Brand.

_{(Residual values used for award calculations are based on the 2023 model-year vehicles that appear in the January/February 2023 Kelley Blue Book® Residual Value Guide. Top 10 models appear in alphabetical order).}

Many new-car buyers do not realize that depreciation often is the greatest expense incurred by drivers during the first five years of vehicle ownership. An average 2023 model-year vehicle will only retain about 45% of its original value after a five-year ownership period, meaning a $45,000 new car today will only be worth somewhere close to $20,250 after five years. In comparison, all vehicles in Kelley Blue Book’s Top 10 for Best Resale Value in 2023 are projected to retain around 60% or more of their MSRP after the initial five-year ownership period.

Resale value for new vehicles can vary greatly. Vehicles with average or below-average resale values generally are plentiful in the marketplace and easy to find, but certain vehicles are projected to hold their value better than others. While much of a vehicle’s resale value is based on supply and demand, as well as current and projected future market conditions, vehicles that retain their value best typically are discounted the least and tend to generate high levels of consumer interest.

Now in its 21^st year, Kelley Blue Book’s Best Resale Value Awards are based on projections from the Kelley Blue Book^® Official Residual Value Guide. Kelley Blue Book^® Residual Values are established by experienced automotive analysts that review the output from statistical models built upon millions of transactions. Vehicles that earn the highest five-year residual values, expressed as a percentage of their original Manufacturer’s Suggested Retail Price (MSRP), are selected for these prestigious awards. Low-volume vehicles are